"Corruption hampers U.S. international trade, affecting the ability of U.S. companies to do business abroad--which in turn erodes U.S. jobs. In some countries, large government contracts are awarded on the basis of bribes rather than merit. U.S. companies are believed to have lost out on business opportunities worth about $27 billion in the past year alone, because they refused to violate honest business practices. Some have abandoned markets altogether, while some unscrupulous competitors take advantage of the corrupt environment to gain control of strategic markets and materials."

The United States has taken the lead on fighting global corruption since the introduction of the Foreign Corrupt Practices Act (FCPA) in 1977. Convinced that the conduct of U.S. corporations reflected on the image of capitalism and democracy in its competition with communism in the Cold War, Congress passed the FCPA to outlaw bribery by U.S. corporations of foreign officials. Subsequent efforts to expand the FCPA and create a global anti-corruption regime have resulted in, first, the OECD Anti-Corruption Convention and, more recently, the UN Convention Against Corruption.

This article argues that the Foreign Corrupt Practices Act, and many later efforts aimed at curbing corruption, has at its core an understanding of corruption that focuses on the individual (bad) actor, what I term the individual actor paradigm. The efforts to reduce the supply side of bribes through the FCPA and its OECD and UN equivalents and the more recent efforts to tackle the demand side of corruption are important responses to the incredible harm of international corruption, but they misdiagnose the dynamics in highly corrupt countries and so fail to adequately address many of the dimensions of corruption. The former Soviet republics of Central Asia, and perhaps other regions, are plagued by a far more complex problem, that of systemic corruption. An effective anti-corruption strategy must begin with an understanding of the political economy of the developing state, and so requires a more sophisticated approach for the sake of both long-term development and the United States' own geostrategic interests.

This article is divided into three parts. In Part I, I outline the individual actor paradigm, with its focus on the individual as the locus of the corruption problem and individualized prosecution as the primary solution. The anecdotal nature and moralistic tone of most corruption stories, the study of corruption situated in economics and in the modern liberal state, and concerns over essentializing corruption all contribute to this individualized focus. International responses to corruption, both on the supply side and the demand side have largely followed this pattern, bringing an individualized prosecution approach that addresses the symptoms but not the underlying structures. …